More Proof That Young People Are Giving Up On The American Dream of A House In The Suburbs

housing demandUrban Land Institute/via

There are many in America who don't like or trust cities, primarily because they harbor a disproportionate number of Democratic voters. They don't like investments in transit, either, preferring the privacy and freedom of the car. But whether they like it or not, America is changing. Amanda Eaken of the NRDC points to a new study from the Urban Land Institute, The New California Dream. (PDF here) The subtitle says it all: How Demographic and Economic Trends May Shape the Housing Market.. Amanda notes the key findings:

First, the existing supply—that’s right, today’s stock—of conventional lot (> 1/8th acre) single-family detached homes exceeds the projected demand for these homes in 2035.

There is no need for building another single family detached house, period, for the next 23 years.

So if people don’t want to live in these homes, where do they want to live? That leads me to the report’s second key finding. In short, the answer is, near transit.

Amanda doesn't go into the reasons for this, why people suddenly want to go green give up the house in the suburbs and take public transit, But the report does at some length. I suspect that the Joel Kotkins of the world are right when they say that the single family house in the suburbs still represents the American Dream. What the report makes clear is that America is changing, people are going to be a lot poorer, and they simply cannot afford it anymore.

home equityUrban Land Institute/via

  • The demographics have changed. The bulk of the demand for housing is going to come from the biggest cohort, the childless baby boomers.
  • Energy is going to keep going up in price. Keeping a detached house cool, and getting to it, is going to become unaffordable.
  • Real Income is going to continue to fall. And unemployment is going to continue to be high.
  • Wealth is going to continue to shift The 1% will continue to get richer and the 99% poorer.
  • Mortgages are going to be out of reach for the majority of people. Big downpayments will keep people out of the housing market and without Fannie Mae, the average person will not be able to get a loan.

age distributionUrban Land Institute/via

On the positive side, the report goes on to a review of preferences, and finds much the same as other studies: the generation Y hipsters state a preference for walkable communities. "This preference is driven by convenience, connectivity, and a healthy work/life balance to maintain relationships."

And before you roll your eyes and say they will grow out of it when they have kids, or suggest that we can all drive to our passivhauses in CNG powered autonomous podcars,

Seventy percent do not believe they have to move to the suburbs once they have children; and only half are confident they will need a single-family home once they have children.

So whether it is because of necessity or changing tastes, the fact remains that planners and politicians had better prepare for an America that is more urban, more transit oriented, more dense. It is no longer a matter of choice.

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More Proof That Young People Are Giving Up On The American Dream of A House In The Suburbs
It's not that they want to live in the city or near transit, it's that they can no longer afford the alternatives.

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